SEC Filings

At the Compensation Committee’s June 2016 meeting, the Committee
approved the LTPP performance measures and targets for the Fiscal Year 2017 – 2019 performance cycle. The targets were established
based on Medtronic’s strategic plan and aligned with the goals disclosed to investors. The revenue growth measure, target,
and performance range are different from those applicable to the annual incentive plan because the LTPP measures cumulative CAGR
over a three-year performance period. Cumulative CAGR requires that each year’s growth is counted. In contrast, standard
CAGR measures only the beginning and end points.

The following table provides detailed information about each performance
measure.

Measure

Rationale

Targets

Weight

Three-year
Revenue Growth

Uses
a cumulative compound annual growth rate (Cumulative CAGR) over three fiscal years, which is a more rigorous measure of sustained
revenue growth.

Return on Invested Capital is defined as Net Cash Earnings plus Interest
Expense net of Tax, divided by Invested Capital for each year, averaged over the 3-year period. Net Cash Earnings is defined as
non-GAAP earnings (adjusted to exclude the impact of non-recurring items) after the removal of the after-tax impact of Amortization.
Invested Capital is defined as Total Equity Plus Interest-Bearing Liabilities less Cash and Cash Equivalents for each year.

Fiscal
Year 2017 Annual and Long-Term Incentive Plan Payouts

Fiscal Year 2017 Annual Incentive Plan Results and Payouts

At the Compensation Committee’s June 2017 meeting, the Committee
reviewed performance against the incentive plan targets for Fiscal Year 2017 and approved the resulting CEO and NEO annual incentive
plan payout percentages and payments as shown below.

Annual Incentive
Plan Financial Results:

Non-GAAPDiluted EPS(2)

Revenue

Growth

Cash
Flow

Indicator(3)

Total
Payout

Percent

FY17 Actual

$

4.60

4.83

%

$

6,180

FY17 Target

$

4.62

5.0

%

$

6,344

Payout Level

97.1

%

98.4

%

87.9

%

Objective Weight

33.33

%

33.33

%

33.33

%

Award Level

32.38

%

32.79

%

29.24

%

= 94.41

Quality Compliance Modifier(1)

—

—

—

Award
Level

—

—

—

=
94.41

%

(1)

The Quality Compliance Modifier performance
threshold was achieved, resulting in no reduction to the annual incentive plan payout.

(2)

Diluted EPS is considered a non-GAAP
financial measure under applicable SEC rules and regulations. A reconciliation of this non-GAAP financial measure to the most
directly comparable GAAP financial measure is included in Appendix A of this proxy statement.